Quinn skeptical about gaming expansion

By SOPHIA TAREEN -
The Associated Press

March 31, 2013

AP photo

Caption

Ill. Gov. Pat Quinn delivers his State of the Budget address March 6 to a joint session of the General Assembly at the Illinois State Capitol in Springfield. Lawmakers pushing to expand gambling in Illinois hope the third time is a charm with a more finely tuned proposal that could make Illinois the fourth state to allow Internet gaming. Quinn is open to expanded gambling, but is unsure about the latest proposals.

CHICAGO – Lawmakers pushing to expand gambling in Illinois hope the third time is a charm with a more finely tuned proposal that could make Illinois the fourth state to allow Internet gaming.

The latest proposal includes some familiar ideas: five new casinos, including one in Chicago; thousands of slot machines, including at Chicago’s two airports. But it also includes Internet gambling, which would allow Illinois residents to play games like black jack on their computers or smart phones.

The biggest obstacle to expansion in Illinois has been Gov. Pat Quinn, who has twice rejected proposals sent to his desk, citing a lack of ethical safeguards, regulation and oversight.

Lately, the Chicago Democrat has signaled that he’s open to the idea, even mentioning it in his March budget speech. And the new bill addresses some of Quinn’s concerns by including a ban on political contributions from the gambling industry, appointing an inspector general to monitor gaming and giving the state gaming board more authority over a Chicago casino.

“The stars are probably lining up better than they’ve ever lined up,” said Sen. Terry Link, a Waukegan Democrat who’s a lead sponsor of the legislation. “We’re doing a lot of the things that the governor wanted.”

But the new proposals still could be held up because of the state’s focus on fixing its nearly $100 billion pension problem – which Quinn has said must be the higher priority. There’s also the governor’s skepticism of so-called “iGaming,” which the bill’s supporters say might be an option to help fix the state’s financial problems.

“There hasn’t been much review on that at all,” Quinn told reporters last week. “Any time you have something brand new, it shouldn’t just be thrown into a bill at the last minute.”

However, other prominent Democrats point out that it isn’t a new idea, and say Illinois already has been a national leader.

When Illinois became the first state to sell lottery tickets online last year, Senate President John Cullerton introduced legislation that would create a Division of Internet Gaming within the state lottery. Under his proposal, that new division would have made Illinois the first state to jump into the world of online gambling.

But that proposal didn’t get much traction, and three states — Delaware, Nevada and New Jersey — since have legalized Internet gambling, though none has it up and running. The process in those states also was fraught with questions of regulation, something Quinn’s office says needs to be watched closely before Illinois can approve it.

But Link, who has sponsored gambling legislation for about half a dozen years, says it only makes sense because people are doing it online illegally, and legalizing it would help bring profits to the state. The new proposal would also give oversight to Illinois Lottery officials, who didn’t return messages seeking comment.

The proposal calls for splitting profits, between treatment programs for problem gamblers and the pension problem. Supporters estimate the profits that would go toward the state’s public pension system could exceed $50 million.

“This is the only revenue-generating bill that’s been introduced,” Link said.

The casinos — including in Rockford, Danville, Chicago’s south suburbs and Lake County — are estimated to generate between $400 million and $1 billion, and the bulk of the money would be allocated to the state’s Education Assistance Fund, after the local communities receive a share of the profits. Some of the profits from slots would be used to help the state pay its backlog of billions in unpaid bills.

Those ideas seem to address exactly what Quinn outlined in his budget address.

“Any enhancement that we enact to gaming revenues this year should be dedicated to education, which could include teachers’ pensions,” he told lawmakers in delivering a budget that includes $400 million less for education. “Of course, gaming expansion has to be done right.”

Those who watch ethics and government praised the contributions ban in the latest bill. Gambling as an industry – including casinos and racing parks – contributed almost $10 million to Illinois public officials in roughly the last decade, according to the most recent analysis by government watchdog group Common Cause.

“It’s an important protection,” said James Browning, a director of the group.

Still, when asked last week, Quinn said he won’t consider gambling until lawmakers solve the pension problem. Quinn has made pensions his top issue for more than a year, but attempts at reform have been stalled. Only recently have lawmakers seen a flurry of pension overhaul bills. Before they left for spring break in March, House members passed their third piece of legislation addressing the heart of the pension issue, cost-of-living increase.

“We still have a ways to go on that,” he told reporters. “We’re not going to be doing gambling expansion before we do our pension reform. Pension reform comes first, that’s imperative.”

Lawmakers have heard Quinn say that before, and their response?

“We actually can chew gum and walk,” Lang said.

He and others also will also have to make a stronger pitch to the Illinois Gaming Board, which has many questions about the new proposal.

For one, the agency — which has been furiously regulating the advent of video gambling — is understaffed, says Board Chairman Aaron Jaffe. He hopes the proposal will equip the board for the expansion. And he doesn’t see it as an immediate fix to the state’s financial problems: the worst-in-nation-pension problem, backlogged bills and a slashed budget.